Tullow shares up after latest oil discovery
Published 29/03/2011 | 05:00
SHARES in Tullow Oil rose yesterday after the oil and gas explorer said it had discovered more oil off the African coast.
In a statement, the company said it had hit 27 metres of net hydrocarbons at the Teak 2 exploration well in the "West Cape Three Points" licence off the coast of Ghana.
Drillers at the previously undrilled fault block between the Jubilee Field and the Teak-1 discovery found five intervals containing "high quality oil, gas and gas condensate".
Six metres of net oil and gas pay were encountered at the top of "good quality" Campanian reserves.
The well will now be suspended for future use and the rig will move to drill the nearby Banda-1 well.
Tullow exploration director Angus McCoss said: "The discovery of hydrocarbons at the Teak-2 location is a very good result, providing important data for the future development of the Jubilee field.
"The well demonstrated that the Teak-2 discovery is not part of the Teak-1 discovery but is potentially a Jubilee field gas cap.
"The Campanian reservoirs at Teak-2 confirm significant up-dip potential in the greater Teak area. Our West Cape Three Points E&A campaign is continuing to deliver and we now look forward to drilling the Banda-1 wildcat well." Davy Stockbrokers' Job Langbroek said the news would not change his forecasts for the company but showed Tullow was continuing to "build out the resource inventory".
"The result of the Teak-2 well may well have implications for Jubilee, although these are too early to quantify.
"Consequently, with no change to Jubilee numbers possible for now, we retain our group net asset value at 1504p per share," he said. Tullow closed up 0.75pc at €16.15.